April 16, 2024
City Manager's Office
DATE: April 16, 2024
TO: Mayor Martinez and Members of the City Council
FROM:
Shasa Curl, City Manager
Andrea Miller, Director of Finance
Mubeen Qader, Deputy Director of Finance
Antonio Banuelos, Accounting Manager
Subject: Update on Cost Recovery and Revenue Enhancement FINANCIAL IMPACT: There is no financial impact from receiving this update
PREVIOUS COUNCIL
ACTION:
December 17, 2019; February 4, 2020; June 8, 2021;
May 3, 2022
STATEMENT OF THE
ISSUE:
City staff are providing an update to City Council and the community on progress to-date regarding cost recovery
and revenue enhancement efforts.
RECOMMENDED ACTION:
RECEIVE a written report on the City’s Cost Recovery
and Revenue Enhancement efforts - Finance Department
(Shasa Curl/Andrea Miller 510-620-6790/Mubeen Qader
510-412-2077/Antonio Banuelos 510-620-6741).
AGENDA
REPORT
April 16, 2024
DISCUSSION:
Background
On December 17, 2019, an item was included on the City Council agenda by the previous Mayor directing the City Manager to explore potential revenue enhancement and cost-recovery measures.
City staff reviewed past City Council meetings and documents to develop an initial list of 30 proposed revenue enhancement and cost recovery measures to explore and potentially implement. The list currently is comprised of recommendations from the City Council, Adopted Strategic Priorities, Management Partners 2021 recommendations, and The California Municipal Revenue Sources Handbook. The Revenue Enhancement and Cost Recovery tracking document was created to monitor research, progress, and results of the proposed measures (Attachment 1). The goal of the document is to support the City in becoming fiscally sustainable and healthy.
Revenue Enhancement and Cost Recovery Measures
As new strategies and opportunities become available, new measures have been added to the document. City staff have been making progress to complete and implement a number of the measures. Chart A outlines the current status breakdown.
Chart A: Status of Measures
Not at
this Time
Exploratory In-progress Implementing Complete TOTAL
Number of
Measures
5 8 20 2 3 38
Below are highlights of progress made since the previous presentation to City Council. Refinanced 2005 B-1 and B-2 Pension Obligation Bonds and 2009 Civic Center Lease Revenue Bonds (SWAP bonds) to a fixed rate effective September 1, 2022.
Incorporated the Solid Waste Collections Franchise Fee into the City’s annual budget.
Collected $16.2 million from Measure U Business License Tax in FY2022-23, with an expected $13 million base going forward.
City Council approved the settlement agreement with PG&E on May 2, 2023, and the initial payment of $200,000 was received.
Received a $1 million grant for berth electrification at Point Potrero Marine Terminal (PPMT).
Awarded over $11 million dollars to provide employment and training services to Richmond residents (Adult Works, Youth, Dislocated Works, English as Second Language, Youth with Disabilities and Construction Trades).
April 16, 2024
Received grants to support literacy services including adult literacy instruction, families for literacy services, and English as a Second Language services, totaling $195,200 through the Literacy for Every Adult Program (LEAP).
Overall, since the inception of our cost recovery and revenue enhancement efforts, staff have successfully completed three key measures, with 20 measures in progress.
Additionally, an extensive analysis of our cost recovery accounts over the past five years reveals a total net of $8,422,188 (Attachment 2). Positive net incomes were recorded in 2019, 2022, and 2023, while 2020 and 2021 saw negative net incomes.
Key contributors to our cost recovery efforts include licenses, permits, fees, and charges for services. In addition, grants received by the City provide vital support for essential City services. City staff are refining procedures to ensure timely grant reporting and monthly drawdowns from grantors.
Next Steps
City staff will continue to pursue feasible measures listed in the attached tracking document and incorporate additional input from City Council.
DOCUMENTS ATTACHED:
Attachment 1 – Cost Recovery and Revenue Enhancement Tracking Document Attachment 2 – Fund Analysis Cost Recovery Accounts